Industrial automation finally ready to accelerate growth, IHS reports
Improving global economy will drive market to $185.3B in 2014
Viewed one way, industrial automation is the force that drives manufacturing worldwide. Viewed as if it were a country, it would be the 53rd largest economy in the world.
IHS Technology looks at it both ways, and both ways they look at it, the industrial automation market is going to show strong growth in 2014 and for the foreseeable future. The global research and analytics company presented its finding on the global industrial automation market at the 2014 Hannover Messe in Germany April 9.
Slowdowns in growth in Europe and Asia over the last two years have stymied expansion of the automation market, but Alex Chausovsky, manager and principal analyst for IHS's industrial automation business, said there is a different atmosphere at Hannover Messe this year. There's a bright light at this show," Chausovsky said. "There is an air of optimism."
Most of that optimism centers on the U.S., which is expected to see 6.9% growth in 2014 in industrial automation. "The U.S. is one of the dominant growth engines," Chausovsky said. "At almost 7% growth, that means it's a really good place to do business."
The other major regions also expect to see steady growth in 2014 as manufacturers prepare to emerge from the recession and upgrade equipment now that manufacturing growth has normalized. The Europe, Middle East and Africa region is expected to grow 4.3%, according to IHS, while China's growth is at 10.7% and Japan at 5.4%.
"Following two years of weak development in the (industrial automation) trade, 2014 will see stronger market conditions that will help generate business opportunities," said Jenalea Howell, associate director for rotating machines & controls at IHS. "In particular, the stabilizing economies of China and Europe will be beneficial to spurring growth this year in overall industrial automation, allowing the market to outstrip last year's performance."
That growth will be split evenly between process industries, fueled by the growth of the North American oil and gas market, and discrete manufacturing growth. IHS research as the machine production market growing by 6.3%, while capital expenditures in the process industry are expected to climb by 5.4%.
Overall, the industrial automation market is a $185.3 billion enterprise, with 40.1% in motors and motor controls, 31.1% in automation equipment and 28.8% in power transmission equipment.
Snapshot of the Americas
The 2014 IHS Technology Industrial Automation Report released at Hannover Messe shows strong growth for this year from a strong base over the last three years. Among the report highlights:
Key customer demands:
- High customer support and quick response time
- Reliability, focus on faster throughput
- Functionality and ease of use
- Split focus on initial cost vs. long-term ROI
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After almost a decade of uncertainty, the confidence of plant floor managers is soaring. Even with a number of challenges and while implementing new technologies, there is a renewed sense of optimism among plant managers about their business and their future.
The respondents to the 2014 Plant Engineering Salary Survey come from throughout the U.S. and serve a variety of industries, but they are uniform in their optimism about manufacturing. This year’s survey found 79% consider manufacturing a secure career. That’s up from 75% in 2013 and significantly higher than the 63% figure when Plant Engineering first started asking that question a decade ago.